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Jared Polis, U.S. Representative for Colorado’s 2nd congressional district

U.S. Federal Trade Commission officials supposedly want to bring an antitrust case against Google due to complaints about it suppressing competition in the market, but Colorado Rep. Jared Polis cautioned the regulatory body in a letter last week that such a lawsuit would be a “woefully misguided step.”

Many Internet businesses, such as Yelp and Nextag, have criticized Google at open hearings in Congress, asserting Google unjustly applies its search dominance to give web sites lower-quality rankings in search results. The effect would essentially push Internet users toward Google products that provide similar services.

Google has continually rebuffed any wrongdoing, and the Vice President of Engineering Amit Singhal even came to his employer’s defense on the Google Public Policy Blog earlier this summer —in an aggressive tactic not usually taken by the Mountain View, Calif.-based company—to spearhead the rumor-mill accusations in a “claim vs. fact” format.

Democrat Polis specifically wrote in his letter that an anti-trust lawsuit by the FTC would “threaten the very integrity of our anti-trust system, and could ultimately lead to Congressional action resulting in a reduction in the ability of the FTC to enforce critical anti-trust protections in industries where markets are being distorted by monopolies or oligopolies.”

Political newspaper The Hill, which first reported on the letter, further noted that Polis said the market for online search remains adequately competitive despite antitrust complaints:

He noted that customers search Amazon for shopping results, iTunes for music and movies, Facebook for social networking and Yelp for local businesses.

“To even discuss applying anti-trust in this kind of hyper-competitive environment defies all logic and the very underpinnings of anti-trust law itself,” Polis wrote.

Polis also indicated a lawsuit could encourage consumers to revolt, as they did earlier this year when lawmakers and policymakers tried to over-regulate the Internet with anti-piracy legislation, and he said, while citing MySpace and AOL as examples, that dominant websites today could be tomorrow’s failure:

“By the same token, the FTC should tread carefully when reviewing Google, Facebook, Twitter or any other tech company, given the dynamism of our tech industry and the potential for making things worse through regulation. Today’s giant can be tomorrow’s failure without any government intervention,” he wrote. “Given how easily consumers can switch to a new service with just one click, regulators should be wary of intervening in the tremendous competition online.”

The FTC announced earlier this year that Washington lawyer Beth Wilkinson is leading its investigation, while FTC Chairman Jon Leibowitz said last month they would reach a decision by 2013. If found guilty, the FTC and Google could enter settlement talks to resolve the matter or duke it out in court.

Get the full report at The Hill, or read Jared Polis FTC Letter (Scribd) for more details.